Open a business account when you're ready to start accepting or spending money as your business, advises the U.S. Small Business Administration. A business bank account helps you stay legally compliant and protected. It also provides benefits to your customers and employees.
Bonus: Keeping your business and your personal accounts separate makes bookkeeping and tax time less of a pain. By setting up separate checking and savings accounts for your business, you have one place to track your income and expenses. (Wingspan's bookkeeping feature automates it all: You'll get a real-time Profit and Loss Statement, and AI software flags possible deductions to minimize your taxes maximize your return.)You can open a business bank account once you've gotten your federal EIN. Here's how to do it:
What Business Bank Accounts Do I Need?
Common business accounts include a checking account,savings account, credit card account, and a merchant services account. Merchant services accounts allow you to accept credit and debit card transactions from your customers.
Should I Use the Same Bank Where I Keep My Personal Accounts?
It depends. Rates, fees, and options vary from bank to bank, so you should shop around to make sure you find the lowest fees and the best benefits.
What Documents Do I Need to Open a Business Bank Account?
- Employer Identification Number (EIN) (or a Social Security number, if you're a sole proprietorship)
- Your business's formation documents
- Ownership agreements
- Business license